US dollar attracts: record concentration in the stock market alarmed!

US dollar attracts: record concentration in the stock market alarmed!

On October 1, 2025, the US dollar shows signs of possible strengthening. Adam Kobeissi, founder of The Kobeissi Letter, points out the latest developments in Bloomberg U.S. Economic Surprise Index, which is positive this week for the first time since February. This index measures whether economic data is above or below the consensus estimates and is often used as an indicator of general economic health.

The positive surprises in the Q2 2025 GdP growth, the first-time income on unemployment welfare and personal expenses are particularly gratifying. Historically, the US dollar tends to fortify yourself when the Economic Surprise Index remains positive for a long time. This could indicate a strengthening of the dollar in the coming time.

Stock market concentration at record height

However, there are worrying signals in the stock market. The concentration in this area is reminiscent of the conditions of the Dotcom crash. The proportion of 10% of the US shares in the entire market capitalization has now reached the record of 78%. This value even exceeds the previous record from the 1930s by three percentage points and is 4% above the maximum level during the Dotcom bubble, which was just 74%.

In addition, the proportion of the largest 10 shares on the S&P 500 is now 41%, which is also a record. This extreme concentration could represent potential risks for investors, especially if you look at the current market dynamics.

High exposure to US budgets in shares

Another point of concern is the high exposure of US budgets compared to shares. Currently, 32% of the total assets of US budgets are invested in shares. For comparison: In China, real estate accounts for 55% of assets, while only 11% are kept in stocks. In other countries such as Great Britain, Korea and Australia, real estate is also the dominant asset, with shares of 57%, 65% and 57%, while shares only make up 7%, 7% or 8% there.

In Taiwan and Japan, households keep 35% and 30% of their assets in real estate, while the share of stocks is 12% and 20% each. This comparison shows the different distribution of assets and could provide important findings for investors who observe developments in both the United States and globally.

The current market situation demands increased mindfulness from investors. With the latest positive signal signals for the US dollar and alarming concentration in the stock market, there are a number of challenges and opportunities. The coming weeks will show in which direction these tendencies will develop.

For more information on this topic, the article from Daily Hodl here could be read.